Team Production & Gift Exchange
In this week’s blog post we read three articles from the New
York Times. The first article is about equality and is explained through the
use of marbles. We are given insight on how a psychologist designed a marble
experiment in Germany to test if children will share their goods or not. I feel
that it is quite difficult to manipulate children as they are innocent and have
not fully understood the concept of greed and selfishness. In the experiment,
75% of the children almost immediately shared the marbles equally with one
another when they had to ‘work’ for the marbles together. This was not the case
however when children had cups with marbles already inside. In this case, the
children believed in the concept of ‘finders keepers’ and did not share as they
did previously. I find this a bit surprising, as I feel that in the
adult world if someone comes across a large sum of money they tend to have a
social responsibility to share. I believe this is the case as they have the
resources to make an impact. This may be as to why so many rich people have
their own NGOs and foundations.
The second article focused on the concept of fairness. This
article mainly dealt with how to be a fair parent using game theory. The
article explains how children want to be treated fairly 100% of the time, and
how it is infeasible for parents to be perfectly fair all the time. I enjoyed
the psychological aspect of this article to most. The author informs us that
due to the evolution of humankind and society we long for fair
treatment. The experiment with the Capuchin monkey supports this point.
I found the third article to be quite interesting. This
article focuses on the concept of altruism. One of the main themes that I have
learned from me studying economics is that we assume people are rational. Due
to this assumption, I tend to think people act on their own selfish interests.
I was particularly intrigued with the concept that “you expect people to be
selfish, you can actually crush their tendency to be good” The example of the
fire department proves this. I feel in certain situations it is to have a trust
policy.
This reminds me of Costco. Costco is a wholesale store with
a wonderful return policy. I was flabbergasted to find out that people can
return opened items of food for a full cash refund. At first, I thought Costco
must be out of its mind to have such a lenient return policy. However, Costco
has been performing strongly as a business and is competing with e-commerce
giant Amazon as well. I feel Costco has a very good relationship with its
customers and expects that the customers will reciprocate. This turns out to be
true as the return policy has been kept the same for decades. However, there
was one exception. The return policy has been changed electronics to only 90
days. I read that many people would buy a laptop and return it after 4-5 years
and purchase a new one with the money they received from the refund. This
became common enough that Costco had to adapt. Even with this slight change, I
feel that Costco is still a consumer-friendly store. Fun fact: A (huge) slice
of cheese pizza has been $1.99 since forever. However, Costco may only be able
to uphold this policy for so long due to its annual membership fee. Does this
act as a margin of safety?
The example of team production with gift exchange that comes
to me is the essay my group is working on. In the first week of class or so we
touched on the topic of gift exchange. This is basically when you don’t trade
anything tangible or expect a reward. I feel this is true when our group would
peer review our sections of writings and providing feedback to each other.
Since this is a group project it may not be the best example, but I don’t try
to help my teammates with the hope that I will be rewarded or not. I guess the
end reward is to receive an A in the paper. Is this truly an example of gift
exchange? I feel the fact that we receive the same grade is essential to us
providing feedback. Otherwise we would probably post intricate comments on each
others blog posts as well. This is an interesting thought to me.
Regarding your last paragraph, there is a general notion of obligation - to family, friends, country. Maybe it exists in the workplace too. You do things out of obligation because you know that those things must be done, not for any reason. As a kid, when your parents try to teach you about obligation, you may resent having to do the things. Somewhat later as a an adult, if your parents't teaching took hold, you will have the sense of obligation without the feelings of resentment.
ReplyDeleteOne of the interesting questions for me in this regard is in what domains the sense of obligation takes over and where does opportunism persist instead. In your story about Costo, it sounded like like both the company and the store were acting well by relying solely on obligation, until it got to comparatively high ticket items of consumer electronics. While I have had desktop computers for more than 4 years, I have never had a laptop that long. That somebody would choose to use the return policy on one of those makes you want to know what their thinking was. I can't imagine doing that myself. I can imagine, however, that somebody who is down on his luck financially, might do it out of perceived necessity. I wonder if that is the explanation.
In the second paragraph you make it sound like kids will act out if there is unfair treatment. However, I would think it is instead that children will act out if they are being treated unfairly. I have a younger brother and if one of us gets the shorter end of the stick, it is usually that one of us that will bring up our concerns. The one with the larger end of the stick will usually keep quiet.
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